Bitcoin Could Win Big as Central Banks Prepare to Hold Rates

Economists are penciling in UK inflation hitting 3% to 4% by end of 2026, complicating rate cuts for the foreseeable future.

Central banks in the US, UK, and the European Union are getting ready to announce their interest rate decisions, with markets expecting that there won’t be any changes across the board.

The policy paralysis has led an analyst to suggest that it could make Bitcoin (BTC) more appealing as a neutral store of value, as shown by its recent strength against the euro and US dollar.

Central Banks Could Hold Steady As Inflation Risks Rise

The cluster of rate decisions, scheduled between March 18 and March 21, has put global markets on edge, with Lacie Zhang, a research analyst at Bitget Wallet, telling CryptoPotato that policymakers in the US, UK, and eurozone are likely to keep rates the same, given the recent surge in oil prices caused by the ongoing conflict in the Middle East.

According to her, this environment is already affecting crypto markets.

“With the BoE expected to hold at 3.75% and the ECB at 2%, both central banks are likely to maintain a cautious stance rather than pursue aggressive hikes or cuts,” she said.

The analyst added that this uncertainty has “supported BTC/EUR, with Bitcoin holding strong above €65,000,” which pointed to more institutions treating crypto as a way to protect themselves against fiat instability.

That expectation matches recent reporting from Reuters that the Bank of England is likely to keep its benchmark rate at 3.75% because inflation risks are rising due to higher energy prices caused by the conflict in the Middle East. Per the report, economists are estimating that by the end of 2026, UK inflation will reach 3% to 4%, therefore complicating any rate cuts in the near future.

Europe is also showing similar caution, with a Bloomberg poll done between March 6 and March 11 finding that most economists think the European Central Bank will keep rates the same for an extended period, even though inflation risks are rising.

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Expectations are similar in the US, as data shared by journalist Sonali Basak on March 16 showed only one rate cut is priced in for 2026 ahead of this week’s Federal Reserve meeting.

Bitcoin Shows Resilience

The price action of Bitcoin reflects the prevailing macro backdrop. At the time of writing, the asset showed a 5% jump from a week ago to trade at about $74,000, per data from CoinGecko. It briefly hit $76,000 in early trading hours on Coinbase, which was its highest level since early February.

Meanwhile, on-chain data suggested a change in sentiment, with crypto analyst Darkfost saying that buyer activity has started to pick up again after a lot of selling in February, as trading volumes on major exchanges also went back up.

Ultimately, Zhang believes that BTC’s performance during this period supports its positioning as a hedge.

“This ‘higher-for-longer’ stance may temper short-term risk-on sentiment, but it continues to support Bitcoin’s positioning as a non-sovereign store of value,” she explained.